Australian Supplier Shutdown Threatens GM and Ford

The closure of auto parts supplier Autodom in Australia could shut down Ford and GM’s local units by next week.

Autodom, which supplies parts to Ford, Toyota and GM’s units in Australia, has indefinitely closed its facilities in the country, part of its plan to half car production in the wake of the global financial slowdown. The government’s tariff support and subsidies worth $2.60 billion were not enough to help the company, as auto industry struggled to keep manufacturing jobs.

Autodom chief executive Calvin Stead said that the company couldn’t deal with the high local production, manufacturing lines that couldn’t be scaled back fast enough and increasing labor costs. He added that he is disappointed that Autodom’s key partners in the industry didn’t even try to help the company.

“We need time and assistance to reorganize ourselves,” Stead said in a statement.

Autodom’s closure also means that Ford and GM will halt production next week, as the company is the largest press metal manufacturer, supplying complex metal and plastic components to automakers. Ford will be the most affected by this shutdown as it buys hundreds of components for its Falcon sedan and Territory SUV vehicles.

“We are currently assessing what effect it will have on our production,” Ford Australia spokeswoman Sinead Phipps told local media. “We are okay until the middle of next week, but if it’s not resolved it could potentially affect our production then.”